The much-anticipated auction of Whistlejacket's $6bn portfolio of so-called "toxic assets" went very well, fetching an average price of 67 cents on the dollar. Whistlejacket was a large structured investment vehicle (SIV) that failed in February 2008 when its sponsor, Standard Charter, stopped providing liquidity. Whistlejacket's portfolio included CDOs backed by mortgage bonds, CLOs, consumer ABS—pretty much a who's who of "toxic assets." The auction included well over $500 million of CDOs that were issued in 2006-2007. Even the CLOs, which are structured products backed by leveraged loans, went for an average price of 70 cents on the dollar. This was easily the biggest secondary-market sale of toxic assets in the past year, and probably the biggest since mid-2007, so the market was watching the auction very closely, looking for some guidance on pricing for toxic assets. The 33% discount price was much better than most people were anticipating. Overall, I'd say the auction lends support to Treasury's argument that a lack of liquidity is artificially depressing the prices of toxic assets. Chalk one up for Tim Geithner.